PMAY (Pradhan Mantri Awas Yojana)

What is the eligibility criteria for the PMAY subsidy?

Under the Pradhan Mantri Awas Yojana (PMAY), the central government has offered Indian citizens a subsidy of INR upto2.67 lacs to qualifying families. Here are a few questions and answers about the scheme.

The purchaser and their family should not have another house under their name.

Annual household income must not exceed INR 18 Lacs. A “Household” is defined as husband, a wife and any unmarried sons and/or unmarried daughters.

The house should be purchased in a joint registration of the husband and wife or just the name of the wife. However, if there is no adult female in the household, the house may be registered in the name of a male member.

Carpet area of the house purchased should be less than 60 sq. mtrs. for income not exceeding RS 6 lacs p.a, 90 sq.mtrs. for income not exceeding 9 lacs p.a and 110 sq.mtrs. for income not exceeding 18 lacs p.a

The scheme can be used to purchase only one unit per family.

The subsidy will always be paid via the provider of the housing loan. i.e from banks/HFC’s

A home loan should be availed for a period of 20 years in order to avail a subsidy up to 2.67 lacs. If a loan is availed for a lesser period then the subsidy amount will be proportionately reduced.

What is the list of documents required to avail the subsidy?

Undertaking from the buyer in the given format

Aadhar card and PAN card

Any other documents as required by the Bank/Financial Institution

What is the list of documents required to avail a Home Loan?

Income Proof for eligibility of loan

Identity Proof

Address Proof

A Bank statement of the Last 6 months

Any other documents as required by the Bank/Financial Institution

I am Single, can I still benefit from PMAY?

Yes, you may apply for the PMAY subsidy if you are single, however, there are different criteria. Unmarried men can make use of the PMAY subsidy if their mother is the co-applicant. In case, there is no surviving adult woman in the family, they may still apply. Unmarried women are also eligible to apply if they are an independent earning member of the family.

Can I still get PMAY if I am not applying for a LOAN?

In order to get PMAY subsidy you must successfully qualify for a home loan.

Will I get the subsidy directly from the government?

The entire subsidy will be given upfront to the housing finance company/Bank by the Government Agency. Thereafter the Bank/HFC will credit the same in borrower’s account. This will result in a reduction in the housing loan amount and consequently, the EMI will also reduce.

Am I eligible for PMAY if I have a house in my native place or village?

If the roof of your village house is not made of concrete, it is not considered a ‘pucca’ house, thereby qualifying you for the housing subsidy.

How can I apply for PMAY?

STEP 1: First you book a flat and apply for a housing loanSTEP 2: Bank sanctions your loanSTEP 3: Registration of the agreementSTEP 4: Your housing finance company/bank submits the claim of the subsidy to National Housing Bank/HUDCOSTEP 5: National Housing Bank transfers the amount to your bankSTEP 6: Bank deposits the subsidy to your loan accountSTEP 7: Loan reduces to the extent of the subsidy received and the reduced EMI is set

How long does it take to received subsidy from the government?

The bank should receive the subsidy in a minimum of 3 months post the application.

Is PMAY applicable to widows or divorcees?

Yes, both widows and divorcees can apply.

What is the age limit to avail PMAY?

There is no age limit, as long as you are eligible for a Home Loan.

What happens if I do not qualify for the PMAY?

If you do not qualify for PMAY, you may still qualify for a housing loan. Xrbia has partnerships with over 20 housing finance companies who have created flexible loan products so that no prospect is ever refused a loan.

Income Tax Return/Computation of Total Income/Auditors Report/Balance Sheet/Profit & Loss Account certified by Chartered Accountant for last 2 years (both for business and personal of partners/directors)

For salaried applicants

Last 3 months' Salary Slip

Repayment Track record of existing loans/Loan closure letter

Bank Statement for the last 6 months from Salary Account

What are the documents required for availing a home loan?

Completed Application Form

Photograph

Photo Identity Proof

Residence Address Proof

Signature Verification Proof

Age Proof

Fee Cheque

What is the term of the loan that banks offer?

Banks and financial institutions usually offer loans for a term of 10 - 25 years.

How much loan can I avail?

You can avail a maximum loan of 80% of the Agreement value. However, your loan amount may differ as per your income eligibility as appraised by the bank. All loans are at the sole discretion of the bank.

Can i get my house financed?

Yes. Choice Goodwill offered for sale have clear titles. Choice Goodwill is approved by most leading banks and financial institution for availing home loans.

Have Any More Question..?

What is the procedure for execution of the agreement to sale?

The procedure involved is three-fold:

Firstly, the payment of adequate stamp duty on the Agreement to Sale

Secondly, Execution of the Agreement to Sale by the Developer/Promoter and the Purchaser

Thirdly, Registration of Agreement to Sale.

What are the documents that should be verified before buying a residential / commercial unit?

RERA REGISTRATION CERTIFICATE

Ownership documents of landowner including title certificate.

Development Agreement, if the developer is not the owner and has acquired the development rights.

Intimation of Disapproval (IOD) and the building plan's approved by competent authority.

Commencement Certificate.

Other permissions issued by the competent authority depending on the nature of plot/type of development.

If the construction is completed then Occupancy Certificate or Building Completion Certificate.

Draft of Agreement to Sale and brochure for specifications, layout and amenities in the flat/complex/layout.

A deduction u/s 80C (2) (xviii) is available on repayment of principal during a financial year up to Rs. 1,50,000/-, this aforesaid limit is within the overall limit of Rs 1.5 lakh specified in section 80C of the Income Tax Act. Stamp duty, registration fee or other such expenses paid for the purpose of transfer of such house property to the assessee is also considered under this amount. This deduction is from Gross Total Income.

Section 24

This section deals with deduction available on Interest paid on capital borrowed for the purpose of purchase, construction, repair, renewal or reconstruction of property. That means you are allowed to deduct an amount equivalent to the total interest payable on the housing loan from your taxable income within the same financial year.

This is now a substantial amount.

It started off with the Income Tax Department offering Rs 15,000 as the maximum amount eligible for deduction in the case of self-occupied property. This later got doubled to Rs 30,000. It did not stop there. After getting enhanced to Rs 75,000, it was then taken to a limit of Rs 1 lakh. Presently, the limit stands elevated to Rs 2 lakh.

So, should you borrow money to purchase or construct, repair, renew or reconstruct property on or after April 1, 1999, you get a deduction of up to Rs 2 lakh on interest paid? The criteria being: the property has to be acquired or constructed within 3 years from the end of financial year in which the capital was borrowed and be self - occupied. When put in figures, this is quite an amount:

Assume taxable income of Rs 12 lakh, placing the assessee in the highest tax bracket.

Assume interest payment during the first financial year is Rs 2.5 lakh

What documents are required if the intended purchaser wishes to proceed for purchase of premises?

The Developer shall execute an Agreement for Sale as per the provisions of The Maharashtra Ownership Flats (Regulation of the Promotion, Construction, Sale, Management and Transfer) Act, 1963 ("the MOFA").

About Tax Benefits

Income Tax Certificate

Every bank issues an income tax certificate that serves as requisite proof to let you avail of tax benefits that accrue on repayment of a home loan. This will typically contain the total amount of interest and capital repaid during the Year. This is mandatory to claim the tax benefit in respect of self-occupied property. You will have to file this with your tax returns and submit this to your employer or chartered accountant to calculate your tax liability.

That brings us to section 80C of the Income Tax Act

A deduction u/s 80C (2) (xviii) is available on repayment of principal during a financial year up to Rs. 1,00,000/-, this aforesaid limit is within the overall limit of Rs 1 lakh specified in section 80C of the Income Tax Act. Stamp duty, registration fee or other such expenses paid for the purpose of transfer of such house property to the assessee is also considered under this amount. This deduction is from Gross Total Income.

Let's start with section 24 of the Income Tax Act

This section deals with deduction available on Interest paid on capital borrowed for the purpose of purchase, construction, repair, renewal or reconstruction of property. That means you are allowed to deduct an amount equivalent to the total interest payable on the housing loan from your taxable income within the same financial year.

This is now a substantial amount. It started off with the Income Tax Department offering Rs 15,000 as the maximum amount eligible for deduction in the case of self-occupied property. This later got doubled to Rs 30,000. It did not stop there. After getting enhanced to Rs 75,000, it was then taken to a limit of Rs 1 lakh. Presently, the limit stands elevated to Rs 1.5 lakh.

So, should you borrow money to purchase or construct, repair, renew or reconstruct property on or after April 1, 1999, you get a deduction of up to Rs 1.5 lakh on interest paid? The criteria being: the property has to be acquired or constructed within 3 years from the end of financial year in which the capital was borrowed and be self - occupied. When put in figures, this is quite an amount:

Assume taxable income of Rs 4 lakh, placing the assessee in the highest tax bracket.

Assume interest payment during the first financial year is Rs 1.60 lakh

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